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File This Lawsuit JUDGE CAPRONI Dale M. Cendali Joshua L. Simmons Jordan M. Romanoff KIRKLAND & ELLIS LLP 601 Lexington A venue New York, New Yark 10022 Telephone: (212) 446-4800 Facsimile: (212) 446-4900 [email protected] [email protected] 19CV [email protected] 7 913 Attorneys for Plaintiffs UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK CHRONICLE BOOKS, LLC; HACHETTE BOOK Case No. ____ GROUP, INC.; HARPERCOLLINS PUBLISHERS LLC; MACMILLAN PUBLISHING GROUP, LLC; ECF Case PENGUIN RANDOM HOUSE LLC; SCHOLASTIC INC.; AND SIMON & SCHUSTER, INC. COMPLAINT Plaintiffs, - against - AUDIBLE, INC. Defendant. Plaintiffs Chronicle Books, LLC ("Chronicle"), Hachette Book Group, Inc. ("Hachette"), HarperCollins Publishers LLC ("HarperCollins"), Macmillan Publishing Group, LLC. ("Macmillan"), Penguin Random House LLC ("PRH"), Scholastic Inc. ("Scholastic"), and Simon & Schuster, Inc. ("S&S") (collectively, "Publishers" or "Plaintiffs")~ by and through their attorneys, Kirkland & Ellis LLP, for their Complaint, hereby allege against Defendant Audible, Inc. ("Audible") as follows. NATURE OF THE ACTION 1. Audible, Inc. unilaterally—without permission from or any notice to Publishers— has decided to introduce a new, unauthorized, feature for its mobile application called, “Audible Captions.” Audible Captions takes Publishers’ proprietary audiobooks, converts the narration into unauthorized text, and distributes the entire text of these “new” digital books to Audible’s customers. Audible’s actions—taking copyrighted works and repurposing them for its own benefit without permission—are the kind of quintessential infringement that the Copyright Act directly forbids. 2. All of the Publishers are member companies of the Association of American Publishers, the mission of which is to be the voice of American publishing on matters of law and public policy. Plaintiffs are seven of the world’s preeminent publishers, and the exclusive publishers and licensees of tens of thousands of the world’s most sought after authors and books. Plaintiffs have collectively spent hundreds of years cultivating well-established sales, licensing and other distribution channels through which books are provided in different formats, e.g., print books, eBooks, and audiobooks, resulting in a vibrant marketplace, of books and ways to consume them. They have been able to do so because of the protections of the Copyright Act and its aim “[t]o promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.” 3. Despite these protections, and despite not holding the rights necessary to do so, Audible seeks to seize for itself a competitive advantage against other audiobook providers who are not violating copyright law, and to cut Publishers out from a business model that already exists, by unlawfully creating derivative works of, reproducing, distributing, and publicly - 2 - displaying unauthorized copies of the Works.1 Audible did not seek a license for the creation and provision of the transcriptions provided to consumers (the “Distributed Text”), does not plan to compensate Publishers or their authors for this feature, nor will it allow them to decide what titles will be made available as Distributed Text. Moreover, Audible Captions does not maintain the quality control that readers have come to expect from Publishers and authors. Indeed, Audible has admitted to Publishers that up to 6% of the Distributed Text may contain transcription errors, the equivalent of 18 full pages of a 300-page book (6,000 errors in a 100,000 word book). And, critically, Audible Captions could directly compete with both books (physical and eBooks) and authorized cross-format (incorporating both text and audio) products, the latter which benefit consumers by not relying on faulty transcription technology and for which Publishers and authors are compensated. 4. If Audible is not enjoined, Audible will take for itself a format of digital distribution it is not authorized to provide, devalue the market for cross-format products, and harm Publishers, authors, and the consumers who enjoy and rely on books. To avoid these results, Publishers asked Audible not to launch the Distributed Text with Publishers’ Works and suggested that Audible limit the Distributed Text to works in the public domain. Audible rebuffed those good faith attempts at resolution and, upon information and belief, intends to launch its new feature on September 10, 2019—a few weeks from now. Accordingly, due to Audible’s refusal to cease and desist or to prevent these imminent harms, Publishers have no choice but to file this lawsuit. 1 “Works,” as used herein, is defined further in Paragraph 36. - 3 - PARTIES 5. Publishers are seven of the preeminent trade publishers in the United States, responsible for developing, publishing, distributing, and marketing tens of thousands of titles a year, spanning a wide variety of topics. 6. Plaintiff Chronicle is a publishing company, having its principal place of business in San Francisco, and is qualified to do business and is doing business in the State of New York and in this District. With over fifty years of history, Chronicle publishes approximately 300 titles every year, and has a print and digital catalog of thousands of titles. Writing across dozens of genres, Chronicle authors, including, among others, Dave Effers, David Borgenicht, Katherine Paterson, Snoop Dogg, Annie Barrows and Gary Soto, are winners of the Pulitzer Prize, the Golden Kite Award, the Caldecott and Newbery Medals, Coretta Scott King Award, and the National Book Award. 7. Plaintiff Hachette is a publishing company, having its principal place of business in New York City, and is qualified to do business and is doing business in the State of New York and in this District. Hachette has been publishing books since 1837, and its publishing brands currently include Little, Brown and Company; Little, Brown Books for Young Readers; Grand Central Publishing; Basic Books; Public Affairs; Orbit; FaithWords; and Center Street. Hachette’s books and authors have garnered major awards including Pulitzer Prizes, National Book Awards, Newbery Medals, Caldecott Medals, and Nobel Prizes. Hachette’s bestselling authors have been published all over the world and include David Baldacci, Michael Connelly, Malcolm Gladwell, Elin Hilderbrand, N. K. Jemisin, Stephenie Meyer, James Patterson, J.K. Rowling, Nicholas Sparks, Rick Steves, Donna Tartt, and Malala Yousafzai. 8. Plaintiff HarperCollins is a publishing company, having its principal place of business in New York City, and is qualified to do business and is doing business in the State of - 4 - New York and in this District. With over two hundred years of history and more than 120 branded imprints around the world, HarperCollins publishes approximately 10,000 new books every year in 16 languages, and has a print and digital catalog of more than 200,000 titles. Writing across dozens of genres, HarperCollins’ authors are winners of the Nobel Prize, the Pulitzer Prize, the National Book Award, the Newbery and Caldecott Medals, and the Man Booker Prize. 9. Plaintiff Macmillan is a publishing company, having its principal place of business in New York City, and is qualified to do business and is doing business in the State of New York and in this District. Macmillan is part of a global trade publishing group operating worldwide, with trade publishing companies in the United States, Germany, the United Kingdom, Australia, South Africa, and India. Macmillan operates eight divisions in the US: Celadon Books; Farrar, Straus and Giroux; Flatiron Books; Henry Holt and Company; Macmillan Audio; Macmillan Children’s Publishing Group; St. Martin’s Press and Tor/Forge. Its writers, including, among others, Jeff VanderMeer, Senator Elizabeth Warren, James Comey, Orson Scott Card, and Paul Beatty, come from a vast array of literary backgrounds and have won awards including the Caldecott Medal, the Nobel Prize, the Man Booker Prize, the Pulitzer Prize, the National Book Award, and the Printz Award. 10. Plaintiff PRH is a publishing company, organized under the laws of Delaware, having its principal place of business in New York City, and is qualified to do business and is doing business in the State of New York and in this District. With a rich history dating back to the 1800s, PRH’s expansive publishing portfolio includes nearly 275 independent publishing imprints and brands on five continents and contains books and products for readers of all ages at every stage of life. PRH publishes 15,000 new titles annually and sells close to 800 million - 5 - print, audio, and eBooks annually. PRH operates a dedicated audiobooks division that publishes 1400 new titles annually and has garnered 15 Grammy awards for Best Spoken Word Album. PRH’s many authors include more than 80 Nobel Laureates and hundreds of the world’s most widely read authors. 11. Plaintiff Scholastic is a publishing company, having its principal place of business in New York City, and is qualified to do business and is doing business in the State of New York and in this District. Scholastic is the world’s largest publisher and distributor of children’s books, and a leading provider of literacy curriculum, professional services and classroom magazines, and a producer of educational and entertaining children’s media. With a history spanning a century, Scholastic creates and distributes quality books and eBooks, learning programs for pre-K to grade 12, and other products and services that support children’s learning and literacy at school and at home. 12. Plaintiff S&S is a publishing company, organized under the laws of New York, having its principal place of business in New York City, and is qualified to do business and is doing business in the State of New York and in this District. It publishes 2000 titles annually in numerous well-known imprints and divisions such as Simon & Schuster, Scribner, Atria Books, Gallery Books, Pocket Books, Adams Media, Simon & Schuster Children’s Publishing and Simon & Schuster Audio and international companies in Australia, Canada, India and the United Kingdom.
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